About the Course
Introduction
This webinar will examine the private foundation excise tax regime under IRC §§4940–4945, with a focus on calculating the current tax on net investment income, identifying transactions and expenditures that trigger penalty taxes, and addressing compliance failures. Our panel of notable tax-exempt professionals will explain how private foundations should analyze net investment income, estimated tax obligations, the 5% minimum distribution requirement, and other tax and reporting obligations to ensure compliance and minimize IRS scrutiny.
Description
Most domestic private foundations are subject to a 1.39% excise tax on net investment income, reported on Form 990-PF, with quarterly estimated tax payments required when the annual tax is $500 or more. At the same time, separate excise tax regimes apply to self-dealing, failures to distribute income for charitable purposes, excess business holdings, jeopardizing investments, and taxable expenditures, with some violations exposing not only the foundation but also foundation managers and disqualified persons to penalties.
The self-dealing rules under §4941 represent perhaps the most significant compliance risk for private foundation managers. Prohibited transactions between a foundation and disqualified persons—including major donors, trustees, directors, officers, and certain family members of disqualified persons—can be subject to excise taxes regardless of intent.
Listen as our accomplished panel discusses how private foundations and their advisers should calculate and report excise taxes, identify high-risk transactions before they occur, consider evolving legislative developments, and implement governance and compliance practices that reduce exposure to penalties while preserving the charitable mission of private foundations.
Presented By
Ms. Ansari is a Partner with Schenck Price, where she is Co-Chair of the Nonprofit Practice Group and a member of the Tax Planning Practice Group. She is currently a member of Schenck Price's Management Committee. Farah acts as outside counsel to nonprofits and possesses significant experience counseling nonprofit organizations including charities, foundations, associations, social clubs, educational organizations, arts organizations, religious organizations, hospitals and other tax-exempt organizations in both New York and New Jersey. Ms. Ansari's practice includes counseling on issues relating to the formation of public charities and private foundations, on-going operations and dissolution. She assists organizations with their transactions, contract negotiation and tax exemption compliance. Ms. Ansari also works with the boards of nonprofit organizations to educate on governance and fiduciary duties.
Mr. Rottkamp has over 38 years of experience providing audit and advisory services to the nonprofit and healthcare industries. He focuses on organizations serving individuals with special needs, community-based and social service organizations, religious organizations, educational institutions, membership associations, healthcare providers, foundations and the arts and culture world. Mr. Rottkamp's technical knowledge allows him to provide specific services, including Single Audits/Uniform Guidance compliance and retirement plan audits. He has counseled some of the region’s most successful nonprofit and healthcare organizations on strategic planning, risk management, sustainability and succession planning. Mr. Rottkamp's expertise includes understanding the Consolidated Fiscal Report (CFR) and resulting rate reimbursement, developing financial forecasts, implementing financial reporting systems, applying FASB accounting standards and delivering high-quality board education and governance guidance. Through this advisement, he has strengthened the governance and internal structures of numerous clients, reflecting his leadership within the industry.
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BARBRI is a NASBA CPE sponsor and this 110-minute webinar is accredited for 2.0 CPE credits.
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BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).
Date + Time
- event
Monday, August 24, 2026
- schedule
1:00 PM ET/10:00 AM PT
I. Overview of private foundation excise tax regime
II. Net investment income tax under IRC §4940
III. Self-dealing rules under IRC §4941
IV. Minimum distribution requirement under IRC §4942
V. Excess business holdings under IRC §4943
VI. Jeopardizing investments under IRC §4944
VII. Expenditure responsibility under IRC §4945
VIII. Filing requirements
A. Form 990-PF
B. From 4720
IX. Legislative developments
X. Practical compliance and risk mitigation
The panel will cover these and other critical issues:
- Identifying the major excise tax provisions applicable to private foundations
- Recognizing prohibited self-dealing transactions under §4941 and evaluating penalty exposure
- Computing net investment income under §4940
- Avoiding self-dealing with disqualified persons
- Satisfying the annual 5% distribution requirement and correcting shortfalls before penalties escalate
- Preparing Form 990-PF and Form 4720 for excise taxes
- Assessing compliance with the §4942 mandatory distribution requirements
Learning Objectives
After completing this course, you will be able to:
- Identify the principal excise tax provisions applicable to private foundations under IRC Sections 4940–4945
- Determine what items are included in net investment income
- Recognize transactions and expenditures that can trigger self-dealing and other private foundation penalty taxes
- Ascertain reporting requirements on Forms 990-PF and 4720 for private foundation excise taxes
- Field of Study: Taxes
- Level of Knowledge: Intermediate
- Advance Preparation: None
- Teaching Method: Seminar/Lecture
- Delivery Method: Group-Internet (via computer)
- Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
- Prerequisite:
Three years+ business or public firm experience at mid-level within the organization, preparing complex tax forms and schedules; supervisory authority over other preparers/accountants. Specific knowledge and understanding of cost allocation principles; familiarity with government standards for nonprofit organizations receiving federal grant monies.
BARBRI, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.
BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).
BARBRI CE webinars-powered by Barbri-are backed by our 100% unconditional money-back guarantee: If you are not satisfied with any of our products, simply let us know and get a full refund. Contact us at 1-800-926-7926 .
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